Twinkies Will Live On – Even In Bankruptcy

by Eugene Melchionne, Esq.

November 19, 2012

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Are you a Twinkie lover?  Fear not, this is not the end of Twinkies as we know it.  Many people think that bankruptcy is the end of life.  In fact, it is only a beginning and Twinkies are a prime example.

Stop.  Put down that home-made Twinkie recipe.  Don’t start hoarding Twinkies.  Well, maybe enough for the next few months, but Twinkie will be with us even after the nuclear holocost.  And if you think about it for just a minute you will realize why. Even New Jersey Governor Chris Christie won’t touch that one.

In bankruptcy, all non-exempt assets are collected and sold with the proceeds used to pay creditors.  Unlike the resst of us, corporations do not get exemptions (property they get to keep) to start over.  Yes, the Hostess Company will be put to death to pay its bills.  But its assets are worth more than a little something.

What are the assets of Hostess?  The Twinkie product, brand and trademarks are all very valuable. And Twinkies are only one part of the whole. If you, the Twinkie-holic, had some money wouldn’t you buy the brand and go into production, if only for yourself?  Of course.  And so will some company who has some money to spend.  They will buy the brand nad resume production, free and clear of the hassles that Hostess company finds itself in.  The only question is whether Snowballs, Yodels, Ho-Hos , Wonder Bread and some of the products go to the same company. Yes, folks, the band may be breaking up, but sometimes the parts are worth more than the whole.

So just as bankruptcy is not the end of Twinkies, bankruptcy is not the end of you.  If you are in financial trouble, follow Twinkies and get a new life.

“ConnecticutGene Melchionne is a bankruptcy lawyer covering the entire State of Connecticut. He can often be found on Google+ and Twitter, where he shares information about consumer protection issues and personal finance.

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Last modified: November 17, 2013